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Wang Mingliang, official from the Investment Department of the National Bureau of Statistics, emphasized that the Chinese government publishes a series of policies in an effort to stabilize housing prices instead of suppressing housing prices.
Wang said that in the long run, growth rate of China's housing prices will decline and maintain relatively stable. Finally it will be in line with residents' income level.
He pointed out that from the viewpoint of development trend between supply and demand, housing demand will be considerably affected in the short run but housing prices is not likely to drop in the long run. He believed that the status of housing supply will not change much recently. Based on the overlarge scale of real estate development and investment and overgrown housing prices, it is impractical to further accelerate real estate development and investment.
Moreover, the conflict between residents' tremendous housing demand and shortage of housing supply will continue to exist in the following years. Under the strict macro-control policy, growth rate of China's real estate prices will fall in the near future but not to an evident extent. In the long run, real estate prices will display a trend of continuous slight increase.
Judging from the structure of housing prices, Wang revealed that growth rate of China's housing prices will slow down but not to a significant degree.
(Xinhua News Agency July 7, 2005)
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